Demographic changes can sometimes be so overwhelming that they trump almost everything else. A population in which the same number of babies is born every year (that is, one without baby booms or baby busts) is very efficient because, for example, no new schools need be built or be closed, and each generation transits through a static infrastructure.
The baby boomers were told they needed to stay invested in the stock market to grow their retirement money and to buy a house. One interpretation of the current financial crisis is that it is a hangover from massive lending by the boomers.
But this raises three important questions:
To whom will the stocks be sold when the boomers are old?
To whom will the boomers sell their houses to or reverse-mortgage their houses to?
http://www.npr.org/templates/story/story.php?storyId=96763713
If economic growth has, for the last century, run in tandem with oil/energy use, what will happen to growth if we walk blindly right into peak oil?
As the number of retirees swells, we can see that these problems may become the biggest considerations. And life extension and genetic engineering have not even kicked in yet. What will the demographics look like with changes like that?
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